Oil firms face more red tape before drilling in UK

Oil and gas explorers face extra red tape before they can drill onshore in the
UK, after an environment group alerted the regulator to the need for them to
gain the same permits as shale gas fracking firms.

In a boon for the shale gas industry, the EA is to announce plans to significantly streamline and speed up the permitting processPhoto: Getty Images

The Environment Agency (EA) is preparing to announce that conventional exploratory wells, which have been drilled onshore for years without the regulator’s oversight, will now require permits for "mining waste" and flaring.

The move is described by industry sources as an irritation that could delay drilling as it will require companies to conduct extra public consultation.

However, in a boon for the shale gas industry, which has the potential to dwarf the existing UK onshore industry, the EA will also announce plans to significantly streamline and speed up the permitting process.

The rule change for conventional drillers is likely to raise questions about the regulator, given it apparently only realised the need for the permits after a challenge by Friends of the Earth.

The campaign group argued a proposed Cuadrilla well at Balcombe in West Sussex required permits under the European regulations introduced two years ago.

Although Cuadrilla is best known for fracking for shale gas in Lancashire, the Balcombe well is targeting oil and the company has no plans at this stage to frack it.

However, the EA concluded the campaigners were right, leading Cuadrilla to abruptly announce it was applying for permits, delaying its work in Balcombe by several months, and one campaigner to claim the regulator had been “caught asleep on the job”.

The decision creates a precedent that will now be applied to all onshore exploratory drilling, in the latest sign of how the controversy around fracking increasing the regulatory burden for others.

David Forster, strategy manager at the EA, told a shale gas conference in Manchester on Tuesday it was “currently reviewing our regulatory position” in light of Balcombe and intended to publish a statement on Thursday.

He said the permits were designed for mining and quarrying but were “being applied by the European Commission to oil and gas exploration, particularly shale gas”.

Operators will have to provide plans for how they deal with waste created during drilling, and may have to gain further permits to "flare" - burn off - waste gas.

However, in a boon for shale gas operators, Mr Forster said the EA was also “looking at ways of streamlining” the permitting process for all involved and was working on new rules that would cut the time taken for approvals from 13 weeks to “significantly less than that”.

Operators have already complained that gaining planning permission - a separate process approved by councils - is becoming more difficult for conventional oil and gas wells.